Buy Now Pay Later Cards; What are they and why are they becoming so popular?

What Are Buy Now Pay Later Cards and why are they becoming more popular?

Over the last few years, the buy now pay later cards uptake has risen considerably across Australia, allowing a different approach when it comes to our payments. With a range of options available, these cards have allowed us to buy and pay in instalments, often without interest. In this piece, we’ll explain how these buy now pay later cards work, some of the most popular versions available to help you decide if owning one would be the right decision for your financial life.

What is Buy Now Pay Later?

Before we take a look into the specific cards, how do the buy now pay later cards work? These services allow you to buy products immediately and pay for them over time, usually in four equal payments due every two weeks. They’ve gained popularity for their convenience and flexibility, especially among younger people looking to manage their budgets without the risk of growing credit card debt.

What are the available buy now pay later cards available in Australia?

Afterpay

Afterpay allows their users to split their purchases into four equal payments, paid every two weeks. There are no interest charges as long as payments are made on time. Afterpay is accepted by thousands of retailers across Australia. Another benefit is the Afterpay app. The app offers an easy way to track your purchases and the payment schedules. For those of you who want a straightforward way to manage purchases and enjoy shopping at a wide range of retailers then Afterpay is a great option.

Zip Pay

Zip Pay is part of the Zip Money family, allowing you to spend up to a set limit and pay it off in flexible instalments. You can choose to pay off the total on your card at any time without a penalty, or make smaller payments. Similar to Afterpay, there are no interest charges as long as you meet the payment schedule. Zip Pay users are given a credit limit, making it easier to budget. Zip Pay is suited for those of you who prefer a more flexible payment structure, allowing for both small and larger purchases.

Humm

Humm is unique in the way it allows you to split your purchases into two options: “Little Things” for purchases up to $2,000, and “Big Things” for larger amounts up to $30,000. With its two payment plan options you can choose between paying in four instalments or spreading payments over a longer term. For the shorter payment plan, there’s no interest as long as you stick to the schedule. Humm is great if you’re  looking for flexibility with both small and large purchases.

Laybuy

Laybuy allows customers to pay for their purchases in six weekly instalments, which can be appealing for larger items.

Laybuy gives you six weeks to pay back your purchase, giving you more breathing room than some other options. Like the other options on this list, Laybuy doesn’t charge interest if payments are made on time. Laybuy is perfect if you would like a bit more time to manage their payments, especially for larger purchases.

Should I Get a Buy Now Pay Later Card?

A lot of the services these cards provide can be hugely beneficial but there are a few important things to remember.

Keeping track of your payment schedules to avoid late fees, which can accumulate quickly is vital. These cards can make it easy to overspend. Stick to your budget and use BNPL services for necessary purchases. Although most BNPL services don’t require a credit check, repeated late payments can affect your credit rating.

Summary

Buy now pay later cards have the potential to revolutionise the shopping experience in Australia, providing you with greater flexibility and control over your finances. Some will believe they are very similar to credit cards, whilst others would rather just pay their purchases in full. These cards have been made to facilitate busy schedules like Christmas and birthdays so you can still make the purchases you want. It’s important to remember to keep in mind they might not suit your payment lifestyle but by gaining knowledge on this new field you can make the most informed decision for yourself.

Here at the GLOSS Vault, we have made it our mission to help as many people like you across Australia and New Zealand feel in control of your money and ensure you’re getting the most out of it. To find out more about us and what we do click here. If you’d like to see our app in action for yourself head here!